Ownership of seized cash determined in favor of Lux Industries Limited, not individual assessee. Deletion of addition upheld.

The Tribunal concluded that the cash amount seized from the assessee belonged to Lux Industries Limited and not the assessee personally. The Tribunal directed the deletion of the addition made by the Assessing Officer and confirmed by the Commissioner of Income Tax (Appeals). As a result, the appeal of the assessee was allowed.

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Issues Involved:
1. Legality of the order passed by the Assessing Authority and sustained by the Commissioner of Income Tax (Appeals).
2. Failure to cross-examine the deponent of the affidavits submitted before the Assessing Officer.
3. Justification of the assessment completed in the hands of the assessee.
4. Validity of the statement of Mr. Bhaskar Poddar as the basis for sustaining the addition.
5. Adherence to judicial decorum and judicial discipline by the Commissioner of Income Tax (Appeals).
6. Legality of charging interest.

Detailed Analysis:

1. Legality of the Order:
The assessee contended that the order passed by the Assessing Authority and sustained by the Commissioner of Income Tax (Appeals) was illegal and against the law. The assessee argued that the cash amount of Rs. 25.00 lacs seized from him belonged to M/s Lux Industries Limited, Kolkata, and not to him personally. The Tribunal noted that the assessee is a commission agent for Lux Industries Ltd. and that the real owner of the cash should be taxed, not the representative. The Tribunal found that the amount seized indeed belonged to Lux Industries Limited and not the assessee.

2. Failure to Cross-Examine:
The assessee argued that the Commissioner of Income Tax (Appeals) and the Assessing Authority failed to cross-examine the deponent of the affidavits submitted before the Assessing Officer, which should have been accepted as per the judgment of the Hon’ble Supreme Court in the case of M/s Mehta Parekh & Co. The Tribunal observed that the affidavit of Shri Ashok Todi, Director of Lux Industries Limited, was supported by various documents and statements, and the Assessing Officer did not cross-examine the deponent, thus the affidavit should be accepted as correct.

3. Justification of the Assessment:
The assessee claimed that the assessment was not justified as the amount belonged to M/s Lux Industries Limited, as admitted by the Director of the company. The Tribunal noted that the Director of Lux Industries Limited, Shri Ashok Todi, admitted that the cash belonged to the company and was being carried by the assessee as a courier. The Tribunal found that the Assessing Officer wrongly assessed the amount in the hands of the assessee.

4. Validity of Mr. Bhaskar Poddar's Statement:
The assessee argued that the statement of Mr. Bhaskar Poddar, which was the basis of sustaining the addition, was not valid in the eye of law as per the judgment of the Hon’ble Rajasthan High Court. The Tribunal observed that the Assessing Officer adopted a pick-and-choose method from the statement of Mr. Bhaskar Poddar, which is not permissible. The Tribunal found that Mr. Poddar’s statement supported the assessee’s claim that the cash belonged to Lux Industries Limited.

5. Adherence to Judicial Decorum and Discipline:
The assessee contended that the order passed by the Commissioner of Income Tax (Appeals) was against judicial decorum and judicial discipline as binding judgments were not followed. The Tribunal noted that the Commissioner of Income Tax (Appeals) failed to follow judicial pronouncements having a binding nature, thereby violating judicial decorum and discipline.

6. Legality of Charging Interest:
The assessee argued that the charging of interest was illegal and against the law. The Tribunal did not specifically address this issue in detail but focused on the primary issue of ownership of the cash amount. Since the Tribunal directed the deletion of the addition, the issue of interest became moot.

Conclusion:
The Tribunal concluded that the cash amount seized from the assessee at the Delhi Airport belonged to Lux Industries Limited and not the assessee. The Tribunal directed to delete the addition made by the Assessing Officer and confirmed by the Commissioner of Income Tax (Appeals). Consequently, the appeal of the assessee was allowed.

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